UNITED KINGDOM: BOE KICKS OFF EASING CYCLE WITH NARROW VOTE – UOB GROUP
The Bank of England (BOE) decided to reduce its Bank Rate by 25 bps from 5.25% (where it has stood since Aug 2023) to 5.00% at its Aug meeting. While Thu’s move was in line with our expectations, it was a close call, UOB Group economist Lee Sue Ann notes.
A close call from the BoE
“BOE kicked off its easing cycle on 1 Aug with a 25bps rate cut to its Bank Rate from 5.25% to 5.00% in a 5-4 vote split. While the move was in line with our expectations, it was a close call.”
“The narrow vote, as well as hawkish elements throughout the accompanying press release and minutes; Monetary Policy Statement (MPS), as well as Governor Andrew Bailey’s press conference; reinforces our view that the BOE is in no rush to reduce rates again.”
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